Supreme Court justices described as “skeptical” of limiting statute of limitations for False Claim Act

Title page Supreme Court case 18-31`5Members of the Supreme Court are skeptical of interpreting the statute of limitations in False Claims Acts cases in a way that would “help fraudsters,” according to attorney Stephen M. Kohn, who attended arguments today in a key False Claims Act case.

Kohn is author of an amicus brief in the case submitted on behalf of the National Whistleblower Center. A decision in Cochise Consultancy, Inc. v. United States, will determine the statute of limitations window for False Claims Act (FCA) cases when the government declines to intervene.

“The Justices appeared to understand the purpose of the False Claims Act is to help the government uncover fraud and were skeptical of interpreting the statute of limitations in a manner that would help fraudsters,” Kohn noted

More from Kohn’s report:

Demonstrating the Courts understanding as to why Congress would have wanted a longer statute of limitations when the relator moves a False Claims Act case forward, even without the government, Justice Sotomayor noted that, “in qui tam the recovery in bulk goes to the government.”

Justice Gorsuch added that to adopt the corporation’s position would be “quite a feat.” Justice Roberts stated that relators know that they must “move promptly” due to the first to file rule. Justice Gorsuch agreed stating “Congress wanted to ensure that relators act quickly.”

When counsel for the corporation tried to argue that the court should ignore the plain text of the statute, Justice Kavanaugh interjected, “Where is the ambiguity?” 

At issue: How should the statute of limitations apply in a qui tam suit in which the United States declines to intervene? The case before the court today ruling today will resolve a three-way split in the lower courts.

Transcripts of arguments are posted on Supreme Court website.

Here are a few excerpts from today’s arguments:

Justine Sonya Sotomayor: But you see, the problem I have is that I know that it appears to give the relator more of a statute of limitations than the government, but, if you look at this statute more broadly, which is that its purpose is to ensure that when some fraud has occurred against the U.S., that there is recovery for the United States, and the qui tam actions, whether it’s the relator or the U.S. prosecuting it, the recovery in bulk, as Justice Ginsburg mentioned, goes to the government. So there is a purpose to this and one that makes logical sense, which is why should it matter that it’s the government’s knowledge that is at issue when it’s the government who stands to benefit from a longer statute of limitations?

Justice John Roberts responding to the argument that a longer statute of limitations allows whistleblowers to “wait in the weeds” and conceal information from the government before making a claim.

Well, that’s — that’s really more of an academic concern. The relators, for example, they know if they don’t move promptly, another relator might preempt them. They know that if they don’t move promptly, the government itself might find out before they have a chance to file, and that would preempt their action as well. The theory of a relator just sort of, as you say, waiting in the weeds I think is not a realistic one.

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